Donald Trump’s future looks grim. He is facing a Georgia lawsuit for interfering in the state’s election. New York Attorney General Letitia James will get the Trump financial documents. And the Southern District of New York (SDNY) has been investigating “hush-money payments for two women who claimed to have had extramarital affairs” with him, according to The Financial Times (FT). But this is worse.
NikeTown originally occupied the 74,000-square-foot space at Trump’s 6 E. 57th Street location during its renovations. It appears there was a problem with Tiffany & Co., which sublet the location. Tiffany’s original plan was for it to stay until the middle of 2022, according to The Crains New York.
The space where it was temporarily housed will be vacant at the end of the lease. That leaves the Trump Organization with five stories of vacant retail space. Wharton Properties and SL Green Realty hold the lease at Trump’s building and will not extend it.
Trump’s worth has plummeted given that the COVID-19 pandemic ate a big hole in his primarily entertainment holdings. Tourists’ and office workers’ foot traffic has all but stopped in Manhattan, the FT reported:
‘Manhattan store vacancies soaring, and the pain is likely to linger for landlords even after the virus ebbs. Meanwhile, the Trump brand is hurting after Donald Trump was impeached a second time for his role in inciting a deadly riot at the U.S. Capitol.’
New York organizations have been “canceling management contracts with the Trump Organization” after the January 6 attempted coup. Many have been pulling down Trump’s name or investigating the action.
President and Chief Executive of Brokerage Wharton Property Advisors, Ruth Colp-Haberm said that some office and retail tenants avoid Trump buildings:
‘Leasing any retail or office space at this point in New York is difficult. [The 57th Street building is] a Triple-A location. The building itself, the spaces are really nice, it’s a lot of glass and steel. It’s extremely nice spaces. But for some users there’s definitely a stigma.’
New York real estate developer, Donald Trump supporter, and former Trump employee Elie Hirschfeld said:
“Tiffany’s is upscale, so it improves the Trump brand. It improves the Trump building.’
Hirschfeld said he thinks the shopping corridor will rebound because it is internationally-known:
‘I believe that the finest streets in all the world are suffering now. But this will come back. It’ll come back strong.’
Nike handed off its lease to Wharton and SL Green. In the deal:
‘Nike’s lease obligations at the building as part of a 2016 deal to relocate the footwear brand to its current New York flagship at 650 Fifth Ave.’
Tiffany subleased the space in 2018. However, the jeweler intends to move back to its removated office space at 7272 Fifth Avenue next year.
Subleases’ rates are usually tied to the market. Tiffany paid seven millon dollars for the Trump space at 57th Street. However, rents had dropped 3.7 percent to $2,575 per square foot on upper Fifth Avenue.
Subleasing to Tiffany helped the Trump name more than Nike Elie Hirschfeld said. In fact, Trump leaving office could improve the areas around Trump Tower. A presidential residence meant more security, including barricades and police. Foot traffic could return.
The 57th Street store does not display the Trump name as it appears at Trump Tower. Guards and employees have been in far greater numbers at the Tiffany store than its few shoppers even though the store was in Tiffany’s signature blue with a five-story reconstruction of the Empire State Building.
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